Liquid Line Items

Plan for adequate irrigation resources next season

Going swimming requires preparation. You need the proper attire, a towel and sunscreen. Before you dive in, you have to measure the water to make sure it’s deep enough.

The same is true when budgeting your irrigation investment for next season. You need tools for maintenance, a good dealer and an understanding of local water restrictions. Forget to factor those into the equation and you’re likely to get hurt by diving in too deep.

"Unless you have a windshield wiper center pivot, you’ve got a power unit and a pump that somehow has to get water to the center of the field," says Dan O’Brien, Extension agricultural economist at Kansas State University.

Ideally, farmers should plan their irrigation needs in the fall, install the system in the winter and have it ready to run at planting.

"You need to go through a thoughtful process of evaluation and make the decision not in a panic mode. You’re not going to be able to install an irrigation system in a drought to save a crop," explains Larry Curtis, a former biosystems engineering professor at Auburn University.

The biggest mistake a producer can make is to underestimate the resources required to dig trenches, install underground pipes, connect to an energy source and more.

"We, in general, haven’t seen a decrease in the cost of pivot systems," says O’Brien, who co-authors a yearly cost-return budget for irrigated corn land in north-central Kansas.

For ground yielding 150 bu. to 190 bu., he projects the following per-acre costs:

Irrigation system: $476

Well, pump and gearhead: $238

Power unit and meter: $66

The budget projects the region’s farmers will pay close to $100 in additional per-acre costs such as labor, fuel, repairs, depreciation and interest. Still, agronomic data suggest the irrigation investment has had a good return for farmers in places such as Kansas.

"Once the corn crop gets to the vegetative stage, an extra 1" of water, in general, will add as much as 12 bu. to 15 bu. per acre," O’Brien notes.

The Hultgren family of Raymond, Minn., has found that planning makes the irrigation investment worthwhile.

"We look for a seven-year payback," explains Duane Hultgren, who farms 4,500 acres with his wife and two sons. Farmers in the region lost their crops to drought in three of the past seven years. That reality, coupled with the ability to push corn yields from 70 bu. per acre to above 200 bu. under irrigation, made the decision to invest $1,800 per acre easier.

"We can’t afford to farm it otherwise," says Hultgren, who raises sugar beets, corn, kidney beans, soybeans, sweet corn, peas and alfalfa. The family has six pivots in operation and is adding four more on their sandier northern 1,500 acres.

Pencil it out. Using the strategy employed by Hultgren, begin planning for your irrigation needs in 2014 with a partial budget. Write down potential benefits of new pivots or upgrades, including added bushels, O’Brien says. Then write down potential costs such as maintaining an aging system or replacing it, along with reduced productivity.

Also explore several line items. First, consider the replacement costs that will be involved with your power system. While pivots have a lifespan of 20 to 25 years, power units generally last six to eight years, O’Brien notes.

Second, you need to evaluate how your pivot will be powered. Options can include natural gas, diesel fuel and electricity, and those prices fluctuate. Some farmers have shifted away from diesel fuel and are using natural gas because it’s less expensive.

While electrical systems are ideal, they aren’t always practical, Curtis explains. Three-phase electrical service is the way to go if it is available. Single-phase service might be an option, depending on local electrical utility recommendations, he adds.

Third, review the components you will need to regularly replace or maintain. Curtis advises farmers to design pivot systems to operate at minimum horsepower. This can be achieved by implementing low-pressure sprinkler nozzle packages.

While Hultgren is a perfect example of the need for pivot planning, he acknow­ledges that farmers can’t control everything. He’s applied to drill the well for his fourth pivot but has yet to get approval from the Minnesota Department of Natural Resources.

Nonetheless, Hultgren says he is committed to adding irrigation as an investment in his operation. "It’s all about family," he says.